Publication Year

2013

Keywords

mathematics, actuarial mathematics, applications, probabilities of undesirable events, actuaries, finances

Disciplines

Applied Mathematics | Finance and Financial Management | Mathematics

Abstract

What is the probability of a person dying? How can these calculations be made? These are all questions that Actuaries seek to answer. Actuaries are mathematicians that calculate the finance behind risk and uncertainty. They calculate the probabilities of undesirable events in order to minimize the financial cost of these undesirable events. Examples of undesirable are car accidents, the death of a person, earthquakes, and tornadoes. Most of these events destroy either buildings or cars, which is why actuaries are usually employed by insurance companies. Actuaries are also employed by health care companies, investing companies, and even banking companies. An undesirable event for an investing company could be a big drop in stock prices, and an actuary would use probability to minimize the financial cost of this. In order to understand how an actuary calculates these probabilities, a few terms must be defined.

Department 1 Awarding Honors Status

Mathematics

Creative Commons License

Creative Commons Attribution-Noncommercial 4.0 License
This work is licensed under a Creative Commons Attribution-Noncommercial 4.0 License

Share

 
COinS